If Expected Inflation Is Constant, Then When the Nominal Interest

question 162

Multiple Choice

If expected inflation is constant, then when the nominal interest rate falls, the real interest rate

• A) falls by more than the change in the nominal interest rate.
• B) falls by the change in the nominal interest rate.
• C) rises by the change in the nominal interest rate.
• D) rises by more than the change in the nominal interest rate.

---

Definitions:

Syllogism Form

A logical argument that applies deductive reasoning to arrive at a conclusion based on two or more premises that are asserted to be true.

Syllogism Validity

The property of a syllogism whereby if the premises are true, the conclusion cannot logically be false.

Enthymeme

A syllogism or form of reasoning in which one of the premises is implicit or assumed rather than stated.

Missing Premise

a logical gap in an argument where an unstated or implied premise is necessary for the argument to hold.